Salary Grade - Meaning & Definition

Published by MBA Skool Team, Last Updated: June 18, 2012

What is Salary Grade?

There are various steps involved in establishing a pay rates which are:

Salary Grade

                                                                                                        PROCESS OF ESTABLISHING PAY RATES

Salary grades form a part of the third step of the process of establishing pay rates. In the Job Evaluation step, the difficulty and importance of jobs are established. Using this information, jobs are then clustered together depending on their importance/difficulty.

Therefore, a pay grade or a salary grade comprises of jobs of approximately equal difficulty or importance. Once these jobs are clustered into the appropriate pay grades, each grade is then priced accordingly to establish the suitable compensation for the corresponding set of jobs.


Hence, this concludes the definition of Salary Grade along with its overview.

This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

Browse the definition and meaning of more similar terms. The Management Dictionary covers over 2000 business concepts from 5 categories.

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